Issuing Foreign Currency Denominated Securities In Nigeria: Regulatory Framework, Constraints And Implementation Considerations

1 Introduction

In a world where financial markets transcend borders, there is a debate on whether Nigerian companies can issue securities denominated in foreign currency domestically in Nigeria. This debate is a result of the rules around access to foreign exchange (“FX”) in the official market through Nigerian banks and the effect of the CBN de-dollarisation policy. While there have been precedents of Nigerian companies issuing foreign currency-denominated securities offshore, such issuances have largely been absent from the domestic market. In recognition of the growing need of some Nigerian companies to have access to FX, the Nigerian Exchange Limited (the “NGX”), on 22 August 2023, unveiled its plan to allow Nigerian companies with significant foreign exchange revenue and companies operating in free trade zones (“FZEs”) to issue and list bonds and stocks denominated in United States Dollars (“USD”) on the Nigerian Exchange Group (the “NGX Exchange”) and pay coupons or dividends